Problema Solution
Determine the present value P you must invest to have the future value A at simple interest rate r after t
A = $3000, r = 13.5%, y= week
(Round to the nearest cent)
Answer provided by our tutors
A = $3000, r = 13.5%, y= week
The formula used to work out simple interest is;
A=P(1+ry)
Whereby A is the accumulated amount; P is the present value; r is the interest rate and y is the time period is weeks.
By substituting the values we have into the variables:
3000 = P(1+13.5 y)
Or P = 3000/ (1+13.5 y)